PRESS RELEASE FOR IMMEDIATE RELEASE September Grenada Announces Exchange by versus

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									PRESS RELEASE                                        FOR IMMEDIATE RELEASE

                                                               September 9, 2005


                      Grenada Announces Exchange Offer


       St. George’s, Grenada: Grenada announced today that it has commenced
an offer to exchange new U.S.$ and E.C.$ bonds for a substantial portion of its
external and domestic bonds, commercial loans and guaranteed debt. Grenada
was forced to suspend payments on most classes of its existing indebtedness at
the end of last year as a consequence of Hurricane Ivan. Grenada’s bilateral
creditors are being asked to provide comparable debt relief.

      The claims eligible to participate in the exchange offer (which are
denominated in both U.S. and E.C. dollars) are in aggregate equal to
approximately U.S.$275 million.

       Grenada was devastated by Hurricane Ivan, which struck the country in
September 2004. The total damage to Grenada is estimated to be in excess of
E.C.$2.4 billion, more than 200% of Grenada’s 2003 nominal GDP. Nearly 90%
of the houses in the country (approximately 28,000 houses) were damaged, of
which approximately 30% were so badly damaged that they required complete
replacement.

        On July 14, 2005, just ten months after Ivan, as Grenada continued to
rebuild, Hurricane Emily, a storm with sustained winds of 90 miles (145
kilometers) per hour, passed directly over Grenada. Emily exacerbated the
severe losses suffered as a result of Hurricane Ivan and struck the few areas left
relatively undamaged by Ivan. Total damages inflicted by Hurricane Emily are
estimated to be approximately E.C.$140 million, or more than 12% of Grenada’s
2004 nominal GDP.

       The new securities being offered in exchange are described in an offering
memorandum dated September 9, 2005. For each eligible claim tendered in the
exchange offer, holders will receive new bonds with a principal amount
corresponding to the tendered principal amount of such eligible claim together
with accrued but unpaid interest thereon. All U.S.$ denominated claims will be
offered new bonds denominated in U.S.$ and all E.C.$ denominated claims will
be offered new bonds denominated in E.C.$. The new bonds being offered by
Grenada will mature in 2025 and have coupons that will increase over time from
0.85% to 8.00% per annum.

       Grenada does not intend to pay any non-tendered eligible claims unless
resources become available to do so. The Government may decide, however, to
continue normal debt servicing of domestic commercial loans and certain
domestic bonds to the extent that the Government concludes that failure to do so
could destabilize the financial sector.

      Representatives of Grenada plan to make a presentation on Friday,
September 16, 2005 in Port of Spain, Trinidad and Tobago to describe the
exchange offer in greater detail to creditors.

        The New U.S.$ Bonds will be issued pursuant to an indenture with
JPMorgan Chase Bank, N.A., as trustee for the holders, and will be governed by
the laws of the State of New York. The New E.C.$ Bonds will be issued pursuant
to a fiscal agency agreement with the Eastern Caribbean Central Bank, as fiscal
agent of Grenada, and will be governed by the laws of Grenada.
        A holder of 9.375% Notes due 2012 desiring to participate in the exchange
offer must submit, or arrange to have submitted on its behalf, a duly completed
letter of transmittal to the exchange agent. A holder of any other eligible claims
desiring to participate in the exchange offer must submit, or arrange to have
submitted on its behalf, a duly completed letter of acceptance to the exchange
agent. The deadline (unless extended by Grenada) for holders of eligible claims
to deliver completed letters of transmittal or letters of acceptance is October 7,
2005.

       Grenada has engaged Bear, Stearns & Co. Inc. to act as dealer manager
in connection with the exchange offer. Questions regarding the exchange offer
may be directed to Bear, Stearns & Co. Inc., Global Liability Management Group,
at 1-212-272-5112 (call collect).

      JPMorgan Chase Bank, N.A. will be acting as the exchange agent.

       Copies of the Offering Memorandum and the Letter of Transmittal and
Letter of Acceptance may be obtained from the information agent, D. F. King &
Co., Inc., at 1-212-269-5550.

                       *                  *                 *                  *

      This announcement is not an offer or a solicitation of offers to exchange any securities. The
      exchange offer is being made solely by the offering memorandum referred to above. The
      distribution of materials relating to the exchange offer, and the transactions contemplated by the
      exchange offer, may be restricted by law in certain jurisdictions. If materials relating to the
      exchange offer come into your possession, you are required by Grenada to inform yourself of and
      to observe all of these restrictions. The materials relating to the exchange offer do not constitute,
      and may not be used in connection with, an offer or solicitation in any place where such exchange
      offers or solicitations are not permitted by law. The new U.S.$ bonds and the new E.C $ bonds
      have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or the
      securities laws of any other jurisdiction. The new U.S.$ bonds and the new E.C.$ bonds will be
      offered in the United States only to qualified institutional buyers (within the meaning of Rule 144A
      under the Securities Act) and to persons outside the United States in reliance upon Regulation S
      under the Securities Act.

								
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